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Stocks hit another pothole this week after President Trump re-escalated tariff rhetoric against China last Friday, which genuinely spooked the market for the first time in months. He has since walked back some of those comments, and the market is rebounding in an encouraging way today. But the U.S.-China trade war is definitely back in the news, so today we aim to steer clear of it by adding a new position in something that’s a little outside our normal sandbox: a foreign currency. More specifically, it’s a fund that offers exposure to a well-known European currency, and it’s up more than 12% year to date – with more potential upside ahead. The fund was recently recommended by Carl Delfeld to his Cabot Explorer audience.

Details inside.

In view of the alarming number of news headlines that point to a weakening economy (at least in some quarters of it), it may seem surprising that the normally defensive consumer staple stocks are underperforming.

Normally, the staples are viewed by investors as something of a safe haven during periods of economic uncertainty, providing as they do essential goods like food and household products that are purchased even in tough times. But the present environment is proving to be an exception to that rule of thumb.

Stocks proved their resilience once again, shaking off the U.S.-China tariff re-escalation fears and creeping back toward their early-October highs. An encouraging start to third-quarter earnings season helped, but that was mostly the banks. The real test will come in the next couple weeks, when most of the big tech companies report. So it’s still choppy waters out there. With that in mind, today we add another fairly low-risk play to the Stock of the Week portfolio in the form of a healthcare REIT that offers a decent yield. It’s a stock Tom Hutchinson just recommended to his Cabot Dividend Investor audience.

Details inside.

Editor’s Note: Due to the Fourth of July holiday next Thursday, your July issue of Cabot Value Investor will come out next Friday, July 5. Happy 4^th!

Leveraging cyclicality is a good way to squeeze more profits out of value stocks.

That was an idea put forth by Matt Warder, the newest addition to the Cabot analyst team and the successor to Bruce Kaser in Cabot Value Investor’s “sister” value investing advisory, Cabot Turnaround Letter, on the latest edition of the Street Check podcast I host with my colleague Brad Simmerman.

Good enough.

That was the resounding sentiment on Wall Street after Wednesday morning’s inflation print came in slightly better than expectations … but still stubbornly above 3% year over year. The headline CPI number for May, 3.3% year over year, was just below the 3.4% economists anticipated; the month-over-month increase (0.2%) was also a bit lighter than expected (0.3%).

The market is at all-time highs. But most stocks are undervalued.

That’s the strange but true reality in today’s Magnificent 7/AI-centric bull market. Yes, if you’ve invested in the seven largest mega-caps or a handful of artificial intelligence-related stocks (Broadcom (AVGO), Palantir (PLTR), Super Micro Computer (SMCI), Taiwan Semiconductor (TSM), etc.), you’ve done quite well. But most other sectors have lagged.

It’s that time of the year when economists and market mavens spill an abundance of ink making year-ahead stock forecasts and boom/bust warnings. As there seems to be an abnormal amount of recession predictions for the year ahead—including a few from some reputable sources—I think we should examine the question: Will the U.S. witness a major economic shock in 2026?

As more hedge funds gravitate to exchange traded funds over individual stocks, here are the six best ETFs today as measured by relative performance.

Our readers are in our thoughts every day as we work to make our advisories readable and useful.

Dividend-paying stocks are a great addition to almost any portfolio, and companies that regularly raise their dividends (like these 3) are even tougher to beat.

I saw The Rolling Stones over the summer, and much like this bull market, they look like they’ve still got a few good years ahead of them.

It was a quiet week, with no companies reporting earnings (no earnings reports scheduled for the rest of the year, in fact) and no changes in ratings. We had three price target increases, for Trinity Industries (TRN), Adient (ADNT) and DuPont (DD), noted below.

Shares of Pinterest (PINS) are selling off today after Q4 earnings came in slightly below expectations (food and beverage weakness a culprit), though the big-picture story remains one of a company that’s made a number of operational adjustments and launched a series of growth initiatives that should drive higher revenue and EPS growth in 2024. I think the recovery story is intact and the stock’s worth owning. Keeping at buy half.

A low-yield market environment has been making it tough to generate income these days. Watch Tom Hutchinson, Chief Analyst of Cabot Dividend Investor as he talks about how to deal with this income crisis.
During this FREE webinar recording he explains how to get a double-digit annual income from supplementing dividend stocks and income paying securities with timely purchases and strategic investments. Tom also tells you about two high-yield stocks to get you started.

After a non-stop run for two-plus months, we’re finally seeing a bit of sloppiness in the Nasdaq and some growth stocks that have had huge runs— combining the recent action with the fact that the advance has been going on 12 weeks and earnings season is upon us, and further stumbles are certainly possible in growth. All that said, it’s been more about rotation than outright selling, as the broad market has actually picked up steam, and none of this alters our big-picture bullish thoughts, as the top-down evidence remains overwhelmingly positive. Put it together, and we’re still bullish, but we’ll pull in our Market Monitor a notch to a level 7 to reflect some of the near-term wobbles.

This week’s list reflects the market action, with more non-tech names, be it cyclical plays, drug firms or even a bull market-related business. Our Top Pick is a bull market stock that has just come alive after a long bottoming effort.

The S&P 600 SmallCap index continues to firm up and even make some progress moving off support near the 102 level (the IJR ETF is at 107 now).

Growth stocks had been improving some, but the sellers never quite disappeared, and now they’re back with a vengeance—many growth-oriented measures are down 6% to 10% this month alone, and even the broad market is going along for the ride.

Thankfully, we never got heavily invested given the indecisiveness, and now we’re throwing up some safety nets—we sold one stock yesterday (giving us more than half in cash) and put two others on hold.



Despite the selling, we’re not throwing in the towel—we see a ton of decent setups still, so if earnings season goes well, there could be some liftoffs. But for now we’re remaining cautious until things change for the better.